Why Robots Will Win the Coming Trade Wars

7/29/17

from Maudlin Economics,

7/25/17:

The first step to surviving a war is knowing which side you are on. But in a trade war, that’s not always easy.
Suppose the US imposed tariffs on steel imported from the European Union. Prices on goods made with that steel would probably rise, but this would affect you only to the extent you rely on those particular goods.
When the EU responded by slapping tariffs on items “Made in USA,” it would hurt you only if your livelihood depended on those export revenues.
Of course, we may be headed toward a wider trade war, which could cause more general price inflation, hurting everyone in some way—though I think it will be more targeted at first.
But one group is sure to win in a trade war because demand for their services will skyrocket.
Who are these lucky people?
They aren’t people at all. They’re robots.

So how do robots fit into this? Stay with me, we’re getting there.

Automate or Die

My associate Robert Ross and I knew after the election that trade barriers would probably rise. In war-gaming the consequences for Macro Growth & Income Alert subscribers, we saw an opportunity in industrial automation and robotics companies.
In particular, we wanted automation suppliers based outside the US that would have better access to countries the US government might try to punish. We found several candidates and recommended one to subscribers in January.

An almost-16% gain in just six months is nothing to sneeze at, but I think it’s just the beginning.

NAFTA Re-Negotiations Begin in Canadian Lumber (& Milk)

4/25/17

from The Gray Area:

4/25/17:

Listen closely to Wilbur Ross's comments about the 20% tariff the US applied to Canadian lumber coming into the US. He points to the fact that if NAFTA was performing the way it was supposed to, the milk issue (and the lumber issue) would not be happening. He further said in answer to a questions, that "every thing relates to everything when you are trying to negotiate".

CNN comments:Trump’s decision to rehash these battles comes just months before he plans to renegotiate NAFTA, the free trade agreement with Canada and Mexico, later this year.
Trade experts say all three sides were already challenged to renegotiate a new deal before the end of the year. Trump’s tariffs on Canada add a twist to the time line for NAFTA talks.